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British overseas territories with significant financial centres have signed up to the government’s strategy to create global tax transparency.
British overseas territories with significant financial centres have signed up to the government’s strategy to create global tax transparency.
The move – by Anguilla, Bermuda, the British Virgin Islands, Montserrat and the Turks and Caicos Islands, among others – follows the Cayman Islands’ commitment to the pilot on multilateral automatic exchange of tax information, launched earlier this month by the UK, France, Germany, Italy and Spain.
The territories will be expected to provide information about bank accounts held in their jurisdictions by individuals and other entities such as trusts. Details will includes names, addresses, dates of birth, account numbers, balances, and facts about payments made into the accounts.
The agreements build on those the coalition government recently secured with the Isle of Man, Guernsey and Jersey to exchange tax information automatically, based on the accord with the US to implement the Foreign Account Tax Compliance Act.
The news coincides with the taxman’s plans to focus on offshore trusts, noted Baker Tilly tax partner Gary Heynes.
“The primary purposes of trusts is for asset protection and while there is less impact on non-UK resident or non-UK domiciled individuals, the current stringent regime means most UK resident individuals would be subject to income, capital gains and inheritance taxes on monies held within offshore arrangements,” he said.
Heynes advised those with funds in offshore trust arrangements to “ensure they are compliant in the UK, and if they aren’t, possibly because they have not kept pace with the change in tax laws, to look to make a disclosure to HMRC before they come asking for the tax”.
